How sophisticated does your database need to be in order to be successful with VDP? A lot less than many people realize.
When many marketers think of Variable Data Printing and 1:1 personalization, they think of a relatively new marketing technology. In reality, the marketing and commercial printing worlds have been using this approach for more than a decade. One of the surprises has been that, it’s not how much data you have, but how you use it. Even marketers with relatively simple databases can create highly effective campaigns with great ROI if they know how to use them.
It’s all about relevance. For example, when one marketer wanted to increase traffic to its retail store, he was concerned about having only names and addresses from a purchased mailing list. The challenge was how to create relevance without recipient demographics, such as likes or dislikes, ages or income levels. How do you create true relevance out of “Dear Bob?”
Use the recipients’ addresses to create maps to the store, along with distances from the recipients’ homes to the retail location. Other marketers using this approach have added estimated driving times. You might not get the same punch as if you had more detailed demographic data, but the impact will be significantly greater than if you’d sent a generic mailer.
VDP marketers consistently find that respondents to VDP campaigns spend more, on average, than respondents to generic campaigns. Thus, the “punch” is not just in the response rate, but in the quality of the responder. Even if you get only a 5% response rate to your “basic” VDP mailing, if your respondents spend 25% more than respondents to generic campaigns, your ROI just shot up exponentially.
Another way to create relevance from a basic list is to do prospecting before sending out the actual promotion. Say you are a pet food manufacturer, but all you have is a list of 100,000 pet owners. Instead of sending out static mailers to all 100,000 names, send out a pre-mailer asking recipients to provide you with more information about themselves in exchange for the chance to win a high-value prize. Respondents provide their names and addresses — whether by mail, email or Web site — along with the type of pet(s) they have and their pets’ ages, genders and names.
Now, instead of an undifferentiated list of 100,000 names, you have a pre-qualified list of pet owners interested in and willing to communicate with your company. Instead of sending out 100,000 mailers, half of which may be irrelevant to some recipients, puppy owners can be sent promotions on puppy food appropriate to the stage of growth of their pooch, and cat owners with felines in their later years can receive promotions on food for boosting energy in older pets. Plus, the front of the food bowl can be personalized with the pet’s name. “Hey, Trixie! It’s your owner’s lucky day!” This, along with the mailing label, might be the only personalized elements visible in the piece, but the content is tailored to the pet owner’s situation.
In the early days of VDP, it was thought, the more data the better. The more you can show the recipient that you know about them, the more successful the piece will be. That has not born out to be true. In fact, barring special situations, such as communications between financial companies and their customers, showing just how much you know about recipients can backfire.
Instead, it’s all about relevance. The extent recipients feel that the piece is relevant to their lives is what stimulates response, not the number of variable elements. And the great news for marketers is that you can create relevance even when the information in the initial database is limited.